US consumer sentiment fell to a record low in May as rising fuel prices and inflation concerns increased pressure on household finances, adding to broader dissatisfaction over economic conditions.
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According to the University of Michigan Surveys of Consumers, confidence among consumers declined sharply, with sentiment among Republicans and Independents falling to the lowest level recorded during Donald Trump‘s second term.
The survey showed the Consumer Sentiment Index dropped to 44.8 in May from 49.8 in April, significantly below market expectations.
Higher gasoline prices linked to disruptions in the Strait of Hormuz have contributed to mounting cost pressures. Energy market instability has also affected global supply chains, leading to rising costs across several sectors.
Economists noted that increasing prices for essential goods, including fuel and everyday consumer items, continued to weigh heavily on households, particularly lower-income families and individuals without college degrees.
Inflation expectations also moved higher, with consumers expecting prices to rise further over both short-term and long-term periods. Analysts said these expectations may complicate future policy decisions by the Federal Reserve System regarding interest rates.
Despite weaker consumer sentiment, financial markets remained relatively stable, with Wall Street maintaining gains and the US dollar showing limited movement.
Economists warned that although consumer spending has remained resilient in recent months, persistent inflation and growing economic uncertainty could place additional pressure on household spending in the coming months.
